The million-dollar question

Seasoned French FriesOne of my clients leaned into a group of his colleagues where I was sitting at a roundtable recently. He peered over my shoulder, and said in a mock comic tone,

“Somebody has drilled the importance of PPA into me.”

I could not see his face, but I knew he was smiling.

I smiled, too. That somebody was me and when I heard that, I thought, “Success!”.  I knew I had made an impact.

We have multiple clients with total guest count in excess of 1 million visitors per year.  By focusing on Per Person Averge (PPA), we have been able to collaborate with many of these companies to raise their annual sales by $1MM,  60-70% of which drops to the bottom line. No matter  how successful you are, no matter how wealthy you feel, that is an amount that will turn your head.

The best businesses continually set aggressive and realistic Per Person Average goals, train their people and hold them accountable every day on every shift. Once they focus on this, initial results typically come quickly. The next level of incremental gains take more effort.  They  praise top performers and share exemplary stories with everyone.  They encourage and re-train the middle performing group and provide remedial support to those who are underperforming. Eventually they realize that they cannot afford to have a server or bartender who cannot sell.

By failing to focus on PPA, many independent restaurateurs are leaving tens of thousands of dollars or hundreds of thousands of dollars on the table.   In some cases, it could cost millions to fail to offer their guests great menu items they might not know about or have the confidence to try.  Most guests are repeat customers who know what they like to eat in the restaurants they patronize, and having found that comfort level, infrequently deviate from those choices.

Meanwhile operators are adding new menu items each year, and perfecting and improving the ones that have been stalwarts.  They don’t truly “serve” people and are remiss if they don’t tell them about  different enjoyable offerings.

The byproduct of this, of course, is revenue.  There is a reason why McDonalds asks “do you want fries with that” and just about every business in every industry has gotten in on the act.

Many independent restaurateurs don’t have the right systems in place to maximize PPA.  The opportunity is there, they just don’t focus on it,  don’t make their guests as happy as they could, and leave the money on the table.

There is no line on the P&L for missed opportunity. How much of that can you afford?  
Seasoned Fries via photopin (license)